SSE hands out ‘to do’ list for new UK energy minister: More battery-powered vehicles and wind power, but no price-cap on fuel bills

More power for more BPVs is on SSE's 'to do' list for MPs
More power for more BPVs is on SSE’s ‘to do’ list for MPs

British Independence from the EU-bloc provides a ‘pivotal opportunity’ for the next UK government to shape a ‘competitive, productive and sustainable’ future for the economy.

And to help the next British government to do this, Perth-based utility giant SSE has published a ‘to do’ list for the new MPs after next month’s Westminster elections in ‘the interests of energy customers and the country as a whole’.

In its ‘energy manifesto’, SSE wants new MPs to:

Put competition at the heart of the energy retail market to benefit consumers (But an energy price cap is not a good idea)

The energy retail market is currently intensely competitive and, whilst switching is not the only barometer of a dynamic market, switching levels compare favourably to comparable markets such as mobile phones or insurance.

There are over 50 suppliers, a diverse range of products on the market and major investment is under way in areas such as faster switching times and smart metering which, if rolled-out in a practical way that is cost-effective and efficient, should in themselves bring demonstrable changes to customers’ experience and engagement in the market.

Intervention in this market – particularly in respect of prices** – requires a clear objective with broad support, careful consultation on both the principles and the detail and, if introduced, should be time-limited and subject to regular reviews to reflect market realities, such as wholesale costs and the charges of various social and environmental policies funded through energy bills.

Without these four caveats, we caution against the unintended consequences of intervention** and the impacts on switching, competition and the range of products and extent of value available to customers.

 

Ensure a cost-effective transition to a low carbon economy by committing to a stable and robust carbon price in the 2020s

The Carbon Floor Price positively impacts security of supply by encouraging investment in both new and existing gas-fired power stations, as well as nuclear life extensions. It also cost-efficiently drives decarbonisation by rewarding those who invest in low-carbon power and encouraging electricity generators to switch away from coal to lower carbon alternatives, such as gas which will play a critical role in the UK’s generation mix in the 2020s.

The UK requires a low-cost decarbonisation strategy and the weight of evidence points to a critical continuing role for a robust and stable carbon price.

 

Build on Britain’s global leadership in the wind sector by putting it at the centre of a modern industrial strategy

The next stage of the UK’s leadership in the global renewables sector should consider the future of onshore wind.

As the cheapest low-carbon source of electricity – and a technology that recent research suggests may be possible to deliver at no additional cost to consumers over and above the long term wholesale price of power – onshore wind has a major role in our future energy mix.

Future considerations can include how to best ensure the UK takes advantage of the optimum wind conditions on the Scottish islands; pursuing new projects that take advantage of the significant cost reductions in the technology; the role of community and shared ownership in wind; and how the 9.9GW of existing onshore wind sites could be ‘repowered’ as they approach the end of their operational project life.

 

Support the network charging infrastructure to boost roll-out for BPVs (battery powered vehicles)

It is encouraging that uptake in ultra-low emission vehicles is increasing and, as with wind, this sector can be a major player in the UK’s industrial strategy.

If BPVs take off on mass-scale we should be aware of how our electricity distribution network will adapt.

It will require investment to accommodate the charging infrastructure, and at the same time additional generation capacity may be required to enable network operators to balance demand peaks. Therefore, the next government should continue to commit to BPVs and work with the industry to develop a strategic roadmap to manage a BPV charging network cost-effectively and efficiently.

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